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Feds obtain Swiss bank data in tax evasion investigation

In a previous post we discussed HSBC's decision to cease some services to United States clients amid a tax evasion probe that has already resulted in huge fines against Swiss banks. The Swiss banks were fined for aiding alleged tax evasion schemes by taxpayers in Orange County and throughout the country. We also discussed the Offshore Voluntary Disclosure Initiative, which had its deadline extended until the end of last week.

Now that the OVDI is over, the IRS and federal investigators are ramping up their crackdown on hidden offshore bank accounts and tax evasion. Reuters reports that federal authorities recently obtained data from 10 Swiss banks in an investigation into hidden assets of American taxpayers. Credit Suisse was the first bank to hand over information to authorities whereas the other banks waited until Friday and handed the data over through intermediaries.

A Swiss newspaper reported that the Swiss government had given federal authorities an estimate on the number of U.S. taxpayers using Swiss accounts to avoid taxes between 2002 and 2010. The Swiss foreign minister stressed that while statistical data was handed over to the United States, no bank client data has been handed over.

"We are still going for a solution on the basis of existing legal rules in Switzerland," said a spokesman for the Swiss department for international financial affairs.

It appears however that the United States is pressuring Swiss banks to hand over bank account information. It is suspected that tens of billions of dollars of assets are hidden by U.S. taxpayers in Swiss accounts.

Source: Reuters, "U.S. Obtains Data From 10 Swiss Banks In Tax-Dodging Probe," Katie Reid, Sept. 10, 2011

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